Hedge Funds Are Dumping Capitol Federal Financial, Inc. (CFFN)

Is Capitol Federal Financial, Inc. (NASDAQ:CFFN) a good investment?

At the moment, there are plenty of gauges market participants can use to track Mr. Market. A pair of the most underrated are hedge fund and insider trading interest. At Insider Monkey, our studies have shown that, historically, those who follow the best picks of the top investment managers can beat the market by a solid amount (see just how much).

Equally as necessary, bullish insider trading activity is a second way to look at the investments you’re interested in. As the old adage goes: there are many incentives for a bullish insider to drop shares of his or her company, but only one, very clear reason why they would initiate a purchase. Several empirical studies have demonstrated the useful potential of this tactic if piggybackers know what to do (learn more here).

Now that that’s out of the way, let’s analyze the newest info about Capitol Federal Financial, Inc. (NASDAQ:CFFN).

What does the smart money think about Capitol Federal Financial, Inc. (NASDAQ:CFFN)?

Heading into Q3, a total of 16 of the hedge funds we track were bullish in this stock, a change of -20% from the previous quarter. With the smart money’s capital changing hands, there exists a few noteworthy hedge fund managers who were increasing their stakes significantly.

When using filings from the hedgies we track, Renaissance Technologies, managed by Jim Simons, holds the largest position in Capitol Federal Financial, Inc. (NASDAQ:CFFN). Renaissance Technologies has a $45.4 million position in the stock, comprising 0.1% of its 13F portfolio. Sitting at the No. 2 spot is Ken Fisher of Fisher Asset Management, with a $29.5 million position; the fund has 0.1% of its 13F portfolio invested in the stock. Some other hedgies that hold long positions include Glenn Russell Dubin’s Highbridge Capital Management, Ken Griffin’s Citadel Investment Group and Howard Guberman’s Gruss Asset Management.

Because Capitol Federal Financial, Inc. (NASDAQ:CFFN) has experienced declining interest from the entirety of the hedge funds we track, it’s easy to see that there lies a certain “tier” of hedgies that slashed their entire stakes heading into Q2. Interestingly, Michael M. Rothenberg and David Sackler’s Moab Capital Partners dropped the largest position of the 450+ funds we monitor, valued at close to $5.8 million in stock. Matthew Tewksbury’s fund, Stevens Capital Management, also cut its stock, about $1.1 million worth. These moves are intriguing to say the least, as aggregate hedge fund interest dropped by 4 funds heading into Q2.

How are insiders trading Capitol Federal Financial, Inc. (NASDAQ:CFFN)?

Insider buying made by high-level executives is best served when the company in question has experienced transactions within the past six months. Over the last six-month time period, Capitol Federal Financial, Inc. (NASDAQ:CFFN) has experienced zero unique insiders purchasing, and zero insider sales (see the details of insider trades here).

We’ll also examine the relationship between both of these indicators in other stocks similar to Capitol Federal Financial, Inc. (NASDAQ:CFFN). These stocks are First Niagara Financial Group Inc. (NASDAQ:FNFG), Northwest Bancshares, Inc. (NASDAQ:NWBI), Sterling Financial Corporation (NASDAQ:STSA), Investors Bancorp, Inc. (NASDAQ:ISBC), and Washington Federal Inc. (NASDAQ:WAFD). This group of stocks are the members of the savings & loans industry and their market caps resemble CFFN’s market cap.